West Texas Intermediate crude surged past $99 a barrel on Thursday, settling at $99.42 — within striking distance of the psychologically critical $100 mark — as a powerful rotation out of technology and into energy stocks powered the sector to its best day in three months. Brent crude closed at $103.15, up 2.3% on the session.
The Energy Select Sector ETF (XLE) jumped 3.7%, handily outperforming every other S&P 500 sector, as investors rotated capital out of semiconductor names following Broadcom’s downgrade and into energy equities. ExxonMobil gained 2.8%, Chevron added 3.1%, and ConocoPhillips surged 4.5% as the broad-based rally in the Dow — up 875 points to a record close — found its strongest expression in old-economy stocks.
The move was driven by a confluence of factors. Summer driving demand continues to tighten gasoline inventories, which fell 1.8 million barrels last week to their lowest seasonal level since 2022, according to EIA data. At the same time, supply concerns persist as OPEC+ delegates signaled they are unlikely to adjust quotas at next week’s meeting given ongoing uncertainty around global demand. The cartel’s Joint Ministerial Monitoring Committee convenes Monday, and sources told Reuters the group sees no urgency to increase output.
Refiners also caught a bid. Marathon Petroleum jumped 3.6% and Valero added 2.9% as crack spreads widened to $32.40 a barrel, their highest since April. The thesis is straightforward: tight crude supply plus robust summer demand equals fat margins for the downstream.
“The rotation into energy has been building for weeks, but today’s Dow record and the tech selloff in Broadcom gave it a catalyst,” said Mike Wittner, head of oil research at Societe Generale. “When the market’s leadership shifts from AI dreams to hard assets, energy is the natural beneficiary. Oil at $100 is the line in the sand — above that, this rotation accelerates.”
The options market suggests traders are betting on more upside. XLE call volume ran at 2.6x the 20-day average on Thursday, with notable accumulation at the $96 and $98 strikes for June expiration. Open interest in WTI $100 call options surged 40% on the session, per CME data.
Key levels to watch: WTI’s immediate resistance sits at $100.10, a level that has capped crude three times since April. A clean break above that opens a run at $103.50, the 2026 high set during the Strait of Hormuz scare in late April. On the downside, support at $96.80 — the 50-day moving average — provides a floor unless OPEC+ surprises with an output increase at Monday’s meeting. For now, the energy narrative is firmly in the bulls’ court.
